Financial Oversight of Sponsored Projects

Transcription

1 Financial Oversight of Sponsored Projects

2 Today s Agenda Introduction Reasons for Principal Investigator Oversight Sponsor and University Policies General Considerations Unallowable Costs Re-Budgeting Cost Transfers Cost-Sharing Salary and Effort Reporting Travel and Business Expenses Facilities and Administrative (F&A) Costs Monthly Reports Financial Reporting to Sponsors Indicators That Problems Exist

3 New faces in OSP Sharon Comvalius-Goddard, Director, Pre-Award April 9, 2012 Carolyn Bargoot, Associate Director, Post-Award May 10, 2012 Susan Zipkin, Director, Post-Award May 21, 2012 Karen Jarvis-Thorne, Assistant Director, Pre-Award May 29, 2012 Michelle Gittens, Assistant Director, Pre-Award October 29, 2012

4 OSP TEAM Sharon Comvalius-Goddard Director, Office for Sponsored Programs/Pre Award Susan Hoban Associate Director, Pre Award Karen Jarvis-Thorne Assistant Director, Pre Award Michelle Gittens Assistant Director, Pre Award Susan Zipkin Director, Office for Sponsored Programs/Post Award Sheila Freedman Associate Director, Financial Management and Compliance Carolyn Bargoot Associate Director, Post Award Diane Fabrizio Assistant Director, Post Award Jack Lane Assistant Director, Post Award 4 Susan Noonan, Information Systems Manager Dan Terminello, Information Systems Analyst Angelica Wilshire, Administrative Assistant

5 Central Research Administration (OSP) Goal: Facilitate Research at BC Priorities: #1a Compliance #1b Customer Service Departmental Administration Goal: Facilitate Research for PI Priorities: #1a Compliance #1b Customer Service We have the same goals and priorities We serve in different roles

6 Research at Boston College Office for Sponsored Programs (OSP) is the oversight body of Sponsored Research Activity at Boston College. As the PI of an award, you are accepting responsibility for scientific, administrative and financial oversight of the project. Successful management begins with compliance.

7 Reasons for Principal Investigator Oversight Although day-to-day sponsored project management may be performed by Department Administrators and others in central administration offices, the Principal Investigator must oversee and be at the forefront of the financial management of sponsored projects DA s should be the front line for assisting PI s

8 Regulatory Pyramid Grant or Contract Terms University Policies & Procedures Sponsor Specific Policies Federal Policies

9 Policies Governing Research Administration Federal Policies: A-21 & A-110 Sponsor Specific Policies: NIH Grants Policy Statement, NSF Grants Policy Manual University Policies & Procedures: Boston College s University policies Grant or Contract Terms: Award specific NIH/NSF/etc. Grant/Contract terms

10 OMB Circular A-21 Establishes principles for determining costs applicable to grants, contracts, and other agreements with educational institutions

11 OMB Circular A-21: Purpose and Scope Establishes the principles for determining the costs applicable to research and development, training, and other sponsored work performed by colleges and universities under grants, contracts, and other agreements with the Federal Government. These agreements are referred to as sponsored agreements.

12 Cost Accounting Standards (CAS) Provides guidance and parameters for higher educational institutions when accounting for costs associated with sponsored projects

13 OMB Circular A-110 Establishes uniform administrative requirements for federal grants and agreements to universities, hospitals and other non-profits

14 OMB Circular A-133 Establishes the standards for obtaining consistency and uniformity among Federal agencies for the audit of non-profit organizations expending Federal awards

15 Examples of Sponsor Specific Policies NIH Grants Policy Statement (GPS) (updated 10/1/12) Policy requirements that serve as the terms and conditions of NIH grants Info on NIH as an organization NIH grant process NSF Grants Policy Manual (GPM) Policies and procedures used by grantees and NSF NSF award process Guidance for unique grant requirements

16 General Considerations Costs charged to a sponsored project must be: Reasonable Allocable Allowable Accounted for consistently Costs that do not meet these criteria may not be charged to a sponsored project, even if only temporarily.

17 Reasonable The nature of the good or service and the amount involved must reflect the judgment of a prudent person.

18 Allocable Relatedness A cost is allocable to a sponsored project if: the charge was incurred solely to benefit a single sponsored project The charge benefits two or more projects and the proportional benefit to each may be reasonably approximated without undue cost or effort (e.g. the cost of lab supplies can be reasonably allocated based on the quantities actually used on each project)

19 Allowable A cost is allowable if it is not expressly made unallowable by relevant cost principles (e.g. entertainment, lobbying, fundraising) or the award terms and conditions. Timely

20 Allocation Methodologies

21 Two Common Allocation Methodologies used at BC Allocation based on the Modified Total Direct Costs (excluding sub-awards) Budget (MTDC) of benefiting sponsored projects. Allocation based upon FTEs. The cost of equipment allocated based upon the number of FTEs using the equipment. The methodology used by a PI should be documented and maintained by the DA for audit purposes For more information please see OMB Circular A-21 section C4.

22 Unacceptable Methods of Assignment of Direct Costs Rotation of charges among sponsored agreements by month without establishing that the rotation schedule credibly reflects the relative benefit to each sponsored agreement; Assigning charges to the sponsored agreement with the largest remaining balance; Charging the budgeted amount rather than charging an amount based on actual usage;

23 Unacceptable Methods of Assignment of Direct Costs Assigning charges to a sponsored agreement in advance of the time the cost is actually incurred Identifying a cost as something other than what it actually is, such as classifying an item of equipment as a supply Charging expenses exclusively to sponsored agreements when the expense has supported departmental agreement activities Assigning charges that are part of normal administrative support (indirect costs) for sponsored agreements

24 Unallowable Costs Entertainment Alcoholic beverages Airfare in excess of the lowest fare available Airfare on non-u.s. carriers General office supplies Most clerical and administrative costs (unless included in the University s approved F&A rate). General use computers Any expenses that are not allowable per Boston College s Policy

25 Re-Budgeting All re-budgeting requests are processed by OSP/Post Award Requests should be based on a projection of the project needs through the rest of the grant budget period OSP has developed a Budget Transfer Checklist for guidance when processing budget transfers

26 Common Re-budgeting Restrictions on Federal Grants Any re-budgeting that would change the scope of work Tuition, alterations and renovations, human subjects Reduction of >25% of key personnel effort Re-budgeting of >25% of total funds in each budget period Anything listed on award notice as requiring prior approval

27 Other Re-budgeting Considerations Re-budgeted from direct cost categories subject to F&A (e.g., personnel, travel, supplies) to direct cost categories which are exempt from F&A calculations will free up F&A which will need to be re-budgeted correctly When making changes from a non F&A bearing category to budget categories subject to F&A to transfer sufficient funds to cover the F&A. When re-budgeting from other budget categories into salary, it is important to remember to make allowance for budgeting fringe benefits

28 Cost Transfers Cost transfers should be exceptional, rather than routine Cost transfers to and from sponsored projects should be done on a timely basis (generally within 30 days of the appearance of the charge on the account, but not more than 90 days) Costs related to sponsored projects may not be temporarily assigned to another sponsored project account and subsequently transferred to the proper project Must meet all the criteria of an allowable cost for the project

29 Cost Transfers Cost transfers must be supported by documentation which adequately explains why the cost transfer needs to occur. Why was it charged to the first project Justification of why it should be charged to project it is being transferred to All cost transfers over 90 days must also include a description of the preventative measures that were put in place to avoid the recurrence of such errors in the future.

30 Cost Sharing Direct costs which are incurred in carrying out a project, but which are not charged to the sponsored project account, are defined as cost sharing Mandatory Required by the sponsor Voluntary Not required by sponsor, but included in the proposal Once the department has volunteered cost sharing in a proposal and the proposal is incorporated into the award, such voluntary cost sharing becomes mandatory for record keeping purposes

31 Cost Sharing At the time of proposal submission, the cost-sharing chart string must be provided by the department and is identified on the Proposal Transmittal form. Once an award is made, OSP will verify the funding is available to cover the committed cost-share prior to the creation of a fund 120 to capture the cost-share expenses Cost sharing should not exceed the amount required by written sponsor policy. Cost sharing in excess of sponsor policy must be approved by the Vice Provost for Research even if departmental funds are used for excess cost sharing.

32 Salary and Effort Reporting

33 Salary and Effort Reporting The Principal Investigator is responsible for accurately reporting the level of effort of individuals whose efforts are being funded by a sponsored project. Salary charges are initially based on estimated levels of effort and must be modified when necessary to reflect actual work experience. Short term fluctuations in effort on sponsored projects do not require redistribution of salaries as long as the overall effort devoted to the project is consistent with the salary charged.

34 Salary and Effort Reporting In no event may the same time be charged to more than one activity. Time and effort certification reports depicting the current distribution of salaries are distributed quarterly. The certification report is sent to each academic department for review, amendment (If necessary), and signature by the PI, or individual, as identified by the PI, with first hand knowledge of the employees work.

35 Travel and Business Expenses When traveling on sponsored project business, travel fares charged to the sponsored project may not exceed the lowest available commercial fare. Personal automobile mileage is reimbursed according to the federally approved rate. U.S. carriers must always be used for domestic travel charged to sponsored projects funded by government sources. For international travel on federal projects, U.S. carriers should be used to the maximum extent possible, and should not be influenced by factors of cost, convenience or personal travel preference.

36 Travel and Business Expenses OSP should be consulted in advance of booking any international travel on a non-u.s. carrier to determine if an exception applies Entertainment costs are not allowable on federally sponsored projects. All other entertainment costs incurred while conducting University business in accordance with University policy must be charged to departmental budgets PDF

37 Facilities and Administrative (F&A) Costs All sponsored project awards must be routed through the Office for Sponsored Full F&A is expected on all grants with the exception of those where specific written sponsor policy precludes it and the University accepts a lower reimbursement rate. The University s F&A rate is calculated in accordance with federal cost principles and is negotiated periodically with the Department of Health and Human Services.

38 Facilities and Administrative (F&A) Costs Under federal regulations, the F&A rate(s) in effect at the time of each competitive segment of an award remains in effect for that competitive segment, even if the F&A rate subsequently changes. The University also applies this rule to non-federal awards that use the federal F&A rate. Any federal F&A rate or a non-federal sponsors stated rate, or requests for reductions from either of the foregoing, must be approved by the Vice Provost for Research.

39 Monthly Reports The University provides access to monthly expenditure reports for each project account through Vista: ACR (Account Comparison Report): This report summarizes the budget, expenditures, commitments, and unexpended balance of the project at the end of each month. TDR (Transaction Detail Report): This report shows individual transactions charged to the project during the preceding month.

40 Ad Hoc Reports The University provides access to an ad hoc summary report through PeopleSoft: Grant Balance Available Summary Gives balance as of the date run

41 Financial Reporting to Sponsors The Office for Sponsored Programs is responsible for all financial reporting to sponsors. All financial reporting to sponsors is based upon expenditures charged to the project according the University s accounting system. While most sponsor financial reporting requirements can be satisfied by reporting forms alone, it may, on occasion, be necessary to obtain supplemental information for some projects from the DA and/or PI.

42 Financial Reporting to Sponsors Monthly or quarterly invoicing required by sponsors to obtain reimbursement or cash advances is done by the Office for Sponsored Programs generally without communication with the Principal Investigator or Department Administrators. The Office for Sponsored Programs prepares all financial reports and final invoices In order to ensure that the reported expenditures include all appropriate charges and exclude inappropriate charges OSP will be in communication with the DA and PI prior to submitting the final report to the sponsor.

43 When to Contact Your OSP Rep ANYTIME! Unauthorized or inappropriate costs have been charged to a sponsored project. Unallowable costs have been charged to a sponsored project. Charges have not been properly allocated among multiple funding sources. Costs incurred on the project are being incurred at a rate that will not permit the project to be completed. Anytime!

44 When OSP May Contact You ANYTIME! Costs are charged to a project based on fund availability, project expiration, or other inappropriate reasons. There are frequent and/or late cost transfers on a project account. Equipment is charged to the project close to its termination date. Frequent requests to carry forward large sums of funding at the end of consecutive budget periods. ANYTIME!

45 Summary of Key Points If sponsored project accounts are managed by Department Administrators, the Principal Investigator should give the DA clear instructions on the allocation of costs The PI should review the status of sponsored project accounts periodically with DA s Allocation decisions should be based on the relationship of the costs to the work performed

46 Summary of Key Points Costs should not be allocated based on fund availability or project expiration. Costs should be charged to sponsored projects only when they satisfy all relevant criteria. Expenses may not be temporarily assigned to sponsored project accounts. Contact your OSP team Anytime!!!!

47 Summary of Key Points Discrepancies in accounts should be resolved promptly. The PI should review the final reconciliation of the project account to ensure his or her concurrence with the financial report to be submitted to the sponsor. The PI and/or DA should contact the Office for Sponsored Programs if either or both have any questions about the financial management of sponsored projects.

48 Questions